Vanderhoof, B.C., facing long-term financial impacts of Canfor mill closure

The District of Vanderhoof, says it is now feeling the full financial impacts of Canfor’s 2024 Plateau sawmill closure and is facing a substantial loss of tax revenue for 2026. 

Canfor closed its sawmills in both Vanderhoof and Fort St. John, B.C., in December of 2024 citing "increasing regulatory complexity, high operating costs and the inability to reliably access economically viable timber."

Kevin Moutray is the mayor of the District of Vanderhoof, a community of about 4,300 people in B.C.’s northern Interior, 100 kilometres west of Prince George.  He says because of the mill closure, the district is now facing a loss of $580,000 in tax revenue equivalent to 11 per cent of its tax base. 

“There may be some tough decisions and there may be some things that don't happen in the budget this year that some people would like to see, because we do have  this financial situation to deal with,” said Moutray. 

The B.C. forestry sector has seen a wave of mill closures over the last few years. The industry has taken major hits as escalating U.S. duties on softwood lumber imports have piled atop challenges like a major beetle infestation and wildfires, leading to thousands of jobs lost across the province. 

Recent closures include the West Fraser ending its sawmill operations in 100 Mile House and Domtar’s permanent closing of its plump mill in Crofton on Vancouver Island. 

“It's difficult in some of these towns and sometimes action only sort of happens in a crisis even though you sort of, can see some of it coming,” said Kurt Niquidet, B.C. Lumber Trade Council president and B.C. Council of Forest Industries chief economist.

“It really doesn't hit home until it's really right in front of you and you have to adapt so for some of those communities they are facing that right now.” 

Gary Bull, professor emeritus from the faculty of forestry and environmental stewardship at the University of British Columbia says local leadership plays a critical role for communities who are affected by mill closures. 

“I think the challenge now for the mayors is, how are you going to roll out the red carpet and welcome investment to help you transition to another basis of employment and economic opportunity and social stability given the downturns that we're seeing,” he said. 

“I would say some communities may be able to remain hopeful, others will have to go through a multi-decade process of adjustment.”

Moutray says District of Vanderhoof staff are actively assessing both the short and long-term financial implications and exploring a range of measures to help mitigate its impact. 

He says Vanderhoof started an industrial reserve fund when West Fraser closed its Houston operations in 2014. 

“It does have an amount of money in it that we'll use to soften the blow, so it doesn’t hit all at once,” said Moutray. “We're also looking at all of our services and seeing where we could potentially cut some expenditures and move some things forward.” 

He says a key priority for the district is to minimize the increase in taxation for residents and businesses while continuing to fund the essential operational activities and core services the community relies on. 

“But it's a significant amount of money and I think that the public has the right to know that there is going to be that pressure on the budget this year,” he said.  

CBC News has reached out to the Ministry of Forests and Canfor for comment.